Speculation Mounts over Buyout of Monitise

A series of banking software vendors are heading the chase for mobile payments firm Monitise, which is said to be open to offers.

Milan Radia, an analyst at global investment banking firm Jefferies, says that finance groups including Fiserv Inc, FIS Global and Temenos may be lining up a purchase for the software maker, which offers a range of solutions to help companies collect money via mobile.

Major payments players such as Visa and MasterCard have also been touted as potential investors, with a purchase thought to be on the horizon.

Looking for a bargain?

The consensus among analysts is that a small pool of companies are interested in turning Monitise back into a force in mobile payments, providing a deal is priced low enough.

Since carrying a worth of £1.38 billion last year, an inability to record profit has seen Monetise plummet to a value of £326 million, from guidance in January 2015.

Decisions from Apple and Google to move into the mobile payments arena have not helped matters, and share prices are continuing their downward slide.

Initial talks

Reports indicate that Monitise has been holding discussions with potential and existing investors regarding its future, and that initial conversations had been productive.

Although all discussions relating to a takeover are at a very early stage, much promise over the company’s health can be taken from the profile of the names involved.

FIS has an existing relationship with Monitise and only this month reported a 6% increase in revenue year on year for Q4 2014. This put the company at $6.4 billion for the final quarter of last year.

But where Radia is concerned, it wouldn’t make sense for Monitise to oversee a complete sale of its business when it is capable of turning things around. Earlier today, the company announced that a deal was in place for it to work alongside a “major European financial institution” in deploying its solutions across a number of different countries.

And as the company appears to be making pro-active decisions regarding its future, share prices have risen up to 24.12 pence, as of 5pm today (February 17).

Last month PerformanceIN reported on shares dropping to 14.75 pence as the company battled through warnings from analysts for investors to sell their stock.

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Richard Towey

Richard serves as head of content at PerformanceIN. After many years spent covering developments from the automotive, sports, travel and finance sectors, he eventually turned his full attention to reporting on stories from the fast-evolving world of digital marketing. Richard now heads up the editorial team at PerformanceIN: the performance marketing industry's leading publication.